Open Enrollment

Author: Jessica Webb-Ayer, XpertHR Legal Editor

Fall may be the season of changing leaves, apples, football and pumpkin spice lattes, but it often means one thing for many employers: open enrollment season. This time of year presents unique challenges for employers and can be a hectic time for HR and benefits professionals. It can be a confusing and frustrating period for employees as well.

Since open enrollment is important to everyone in the workforce, employers should be familiar with best practices for handling this stressful time of year. The following are key steps an employer can take to effectively manage the open enrollment process.

1. Evaluate Current Benefit Offerings

Employee benefits should be designed to meet both employee and employer needs. However, since such needs can change over time, an employer needs to continually evaluate its benefit offerings to make sure they match the organization's evolving needs and strategies. A good time for an employer to assess its current benefit offerings is when it begins initial preparation for open enrollment.

2. Develop a Year-Round Communication Schedule

Many employers communicate with employees about benefits only once a year, right before open enrollment. However, presenting so much information to employees all at once can be overwhelming, and important details can get lost in the flood of open enrollment materials.

Ideally, an employer should develop a plan to communicate benefits information all year, and open enrollment should only be one part of this strategy. This way, when open enrollment approaches, the employer does not have to present everything at once and can focus on changes to benefit plans and helping employees through the process.

3. Engage Employees

Employee benefits are usually very important to employees, and an employer needs to make sure its workforce understands the significance of open enrollment and is engaged in the process. An employer should develop a communication strategy that takes into account all of its employees, realizing that people process information in different ways and considering the multiple generations currently in the workforce.

Traditional methods of open enrollment communication like brochures, postcards and newsletters are a great place to start. However, it is also a good idea to use other communication techniques such as social media, webinars and text messaging to reach your entire employee audience.

To have an efficient and effective open enrollment, an employer may want to consider:

  • Using e-mail alerts or postcards to remind employees of enrollment dates;
  • Keeping supervisors well-informed by giving them information ahead of time; and
  • Holding employee meetings to review benefit offerings and any changes.

4. Explain, Explain, Explain

Open enrollment is a time when an employer can reinforce the value of the benefits it provides to its workforce. If an employer is adding coverage during open enrollment, it should highlight such enhancements to employees.

Additionally, employers should communicate early and often about any changes to benefits that are happening at open enrollment. An employer should also let employees know:

  • The basis for the changes;
  • What other alternatives were considered;
  • Why the employer chose a specific approach; and
  • How the changes benefit employees and help the organization meet its objectives.

Benefit costs have been going up for years, and an employer should explain this reality to employees and also highlight how much of the cost the employer is taking on. Most employees are going to have to pay a portion of premiums, but generally the employee-paid amount is significantly less than the portion the employer is paying. This is also the time to highlight just how significant benefits are to overall employee compensation, and an employer may want to consider the value of using total compensation statements.

5. Help Employees

Employers spend a lot of money on benefits for their workforce, and they want employees to use, appreciate and understand their benefit offerings. As always, communication is key to helping employees figure out their benefit plan options and enabling them to make the best decisions for themselves and their families. The summaries of benefits and coverage required by the Affordable Care Act are helpful, but including more examples and scenarios could enhance open enrollment materials even more.

One of the biggest challenges an employer faces during open enrollment is convincing employees to spend the time necessary to become familiar with the employer's benefit offerings. If an employee has already been in enrolled in a particular plan, he or she may just automatically re-enroll without looking at any new changes or options. Employers should encourage employees to review everything every year to make sure they are choosing the options that are the best fit for their circumstances and lifestyles.

6. Remember Qualified Beneficiaries

Employers should not forget about qualified beneficiaries under the Consolidated Omnibus Budget Reconciliation Act (COBRA). Such individuals must be offered the same benefits, the same benefit choices, and the same co-payments, deductibles and coverage limits as similarly-situated individuals. Additionally, qualified beneficiaries must have the opportunity to choose different benefits during open enrollment.

7. Highlight Non-Health Benefits

Even though health insurance is probably the benefit that is most critical to employees, an employer should not neglect emphasizing all the benefits it offers, even the more atypical ones. For example, in open enrollment materials, an employer can emphasize that voluntary benefits are also helpful to employees because the employer has been able to get a group rate on the insurance.